AutoNation head, Mike Jackson, gives his views on Tesla’s new plan to achieve 500,000 deliveries by 2018
For the good or bad, Tesla Motors Inc (NASDAQ:TSLA) plans to accelerate its production target of achieving half a million deliveries by 2018, instead of 2020, has been an eye-opener for many analysts and industry experts. While we already know that analysts have a mixed opinion about the move, let’s take a look what AutoNation, Inc. (NYSE:AN) President, CEO and Chairman, Mike Jackson, thinks about the Build Plan.
Mr. Jackson, head of the largest US auto retailer and possibly rival to Tesla’s direct-sales business model, was recently invited as a guest at CNBC’s “Square Box” to discuss the young electric vehicle (EV) company’s production outlook, being in the automobile industry for several years.
When the executive initially heard about the company’s new outlook, he expressed himself saying that “I was somewhere between the word audacious and preposterous […] wasn’t sure which point to settle on.” He also notified that Tesla has created a reputation for “missing every launch date by years.”
He rightfully pointed out that if the automaker is actually serious about the guidance, it requires launching its first mass-market vehicle, the Model 3, in July, 2017, about six months ahead of its delivery date of 2017 end. This will be essential to increase the $35,000 vehicle’s production at an extremely huge scale and achieve targets for the upcoming couple of years.
Mr. Jackson highlighted that the company lost two key senior production executives just hours before the earnings release of the first quarter of fiscal year 2016 (1QFY16) in which it made its new production announcement.
Though, the AutoNation leader did agree with the management that their Model 3 will be far more easier to manufacture than its predecessors, the model X specifically, which he described as “unbelievably complex” to build.